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Financial Fair Play

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Re: Re:

11 Sep 2017 18:19

samhocking wrote:So initially a salary cap changes nothing,
Correct.
samhocking wrote:but over the longer term Froome will not be able to earn more than his 4M even if he and sky achieve more success, but Nibali will be able to earn more even without any improvement in results?
Incorrect.
samhocking wrote:Likewise for all the best support riders who are in demand by the best teams.
Without a floor, they are the very riders likely to suffer from a salary cap.
samhocking wrote:The thing is riders salaries are hardly spiralling out of control.
I know you all hate it when I ask for supporting evidence but please, for this, some supporting evidence. I've posted the UCI's E&Y stat showing a salary increase across the board in all 40 or so pro-level teams of 38.9% between 2009 and 2012 (at a time when the global economy was in crisis and real-world wages were being atrophied by austerity). I've posted Sky's wages bill doubling between 2010 and 2014. I've posted figures showing AG2R's total budget climbing 50.4% between 2010 and 2014 (the link between budget and wages is, at this stage, I think clear, so quoting a budget figure is fair). I've show you mine. Now let's see your evidence.
samhocking wrote:The primary concern of all teams is finding sponsors. Team Sky started on £7M in 2010 iirc.
Technically it was 2009 and GBP 0.665m. In 2010 it was GBP 9.987m.
samhocking wrote:They were well below the budget of 5 other teams far more successful than them at the time. Over time though and with success it increased. For one, Team Sky's staff went from I think 30 permanent staff to over 100 between 2010 and 2013/14 so much of the increase in sponsorship revenue was not simply rider wages but 70 new staff contracts. Even on a measly £30K a year that's over £2M alone and doesn't include their expenses travelling all over Europe racing and flying and driving extra vehicles that also need to be bought.
I recall I compared AG2R's race expenses and Sky's, I think for 2011: Sky claimed GBP 1.366m. More relevantly, as a percentage of total income, Sky's wages bill, for riders and staff, has been between 71.94% in 2012 and 73.57% in 2015. And even I have lost the thread of the point being made.
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11 Sep 2017 18:40

Again, to repeat something already said about wage inflation and add something extra:

JV:
"The wage inflation in cycling, that has pushed budgets up, concerns maybe for the top 15 riders in the world."
Andrew McQuaid:
"The salaries for the top 10 big riders have dramatically increased. But it’s all weighted in their favour. The salaries of the lower-level riders haven’t increased at all."
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11 Sep 2017 19:30

As there's so much interest in a salary cap: anyone care to explain how it can be policed?

(For fun, let's personalise all these questions to Sky, even though - personally - I think personalising this to Sky is wrong and causes more problems than it solves.)

Anyone care to explain how, say, British Cycling couldn't put someone on the Olympic programme as a way of underwriting their Sky salary

Anyone care to explain how Pinarello couldn't come to a personal arrangement with any or all of the individual riders hired by Sky?

Anyone care to explain how the Times or the Herald Sun or the Wall Street Journal couldn't offer substantial sums for rider diaries from Geraint Thomas, Ian Boswell or any other Sky rider?

Anyone care to offer other not very imaginative means of getting money from sponsor A to rider B without going through team C?
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Re:

11 Sep 2017 20:51

fmk_RoI wrote:As there's so much interest in a salary cap: anyone care to explain how it can be policed?

(For fun, let's personalise all these questions to Sky, even though - personally - I think personalising this to Sky is wrong and causes more problems than it solves.)

Anyone care to explain how, say, British Cycling couldn't put someone on the Olympic programme as a way of underwriting their Sky salary

Anyone care to explain how Pinarello couldn't come to a personal arrangement with any or all of the individual riders hired by Sky?

Anyone care to explain how the Times or the Herald Sun or the Wall Street Journal couldn't offer substantial sums for rider diaries from Geraint Thomas, Ian Boswell or any other Sky rider?

Anyone care to offer other not very imaginative means of getting money from sponsor A to rider B without going through team C?

If we're playing fantasy cycling then an auction such as they have in the IPL cricket overcomes all of that I think
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Re: Financial Fair Play

11 Sep 2017 20:55

samhocking wrote:
Benotti69 wrote:
samhocking wrote:The OWCP riders change and are published each year/ Olympic cycle by UKSport & BC so I just copied and pasted that part from a members email, but there's no secret if you're a British pro tour rider on the OWCP program, you have free access to everything at British Cycling no matter what pro tour team you're on and it's free to that rider as a drop-in service between racing commercially. For riders not in the OWCP (has been cut from 16 to 8 pro riders) like Cavendish or Stannard they can still use British Cycling services under what UKSport now call the Elite Affiliate Programme I believe designed to manage their exit because clearly riders like Cavendish & Stannard have their entire coaching, medical and sports history at BC more or less and so this needs to be managed with their teams to take over instead of BC or to continue it.

In terms of the SLA between those OWCP riders in other teams, of course I don't have that agreement, but if you follow those riders, they're in and out of Manchester, especially if injured and recovering, but will be at the BC training camps, many still use BC Coaches within the season and in their build up for the Worlds each year and Olympics despite on different teams.

In terms of the SLA payments from TRLtd to BC, there was no financial conflicts raised in Deloitte report as far as I know. The main conflict, was non-Sky riders thought the OWCP riders were at an advantage if Sky riders and the non-Sky BC staff resented those working with Sky who they thought had more staffing resources being in both camps at once.


I asked for a link. When you are ready and in your own time.


A link to what exactly?

<snipped repitive response>


This

Benotti69 wrote:
samhocking wrote:British Cycling staff, even from day one invoice Tour Racing Ltd to an agreed Service Level Agreement Libertine based on what riders are OWCP or not. The Delloite investigation didn't find any conflicts, but did advise the SLA was extended to define the exact roles of dual staff supporting British pro tour riders who are Lottery-funded, British pro tour riders who are not Lottery-funded, and foreign pro tour riders on Team Sky so accounts could be paid according to the riders lottery funding or not. Since 2011 it's very clear-cut and you certainly couldn't have say Landa going to Manchester for free BC specialist treatment, Sky would be paying for that according to Tour Racing Ltd's SLA with BC, no different than any Pro tour team having an SLA with a private company or National body.
The following riders are lottery funded this year and would not have to pay to use any British Cycling resources even those that are not Sky riders.

Owain Doull (Sky)
Chris Froome (Sky)
Dan McLay (Bretagne–Séché Environnement)
Luke Rowe (Sky)
Ian Stannard (Sky)
Ben Swift (UAE)
Geraint Thomas (Sky)
Scott Thwaites (Dimension Data)

So, when Cavendish, not lottery funded needs to use British Cycling resources this year, either he pays for it personally now, or Dimension Data do. However, his team mate Scott Thwaites gets it free because he's on the OWCP even though not a Sky rider. The existing arrangement betwen British riders and British Cycling benefits other teams too, so it's not exactly a close relationship between Sky & British Cycling. All teams have free BC access and rider support if they employ a OWCP rider.

<snipped for brevity>


Got a link to this information?


TIA. :)
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Re:

11 Sep 2017 21:12

Libertine Seguros wrote:The issue would then be that it opens the transfer market up to various in-season trading where a team needs to open up cap space for purchases they want to make. Riders might have to be cut or waived to open up salary cap space, and picked up off waivers into the season when injuries and illnesses hit (a bit like IR works in American sports). A lot of these things happen to an extent anyway, but would become much more major players in the way teams do business than the occasional cut-price option in the market thanks to a team falling apart, the most notable example being how Sky picked up Christian Knees from the ashes of the Pegasus debacle and have turned him from being a middling Classics rider to one of their domestiques of choice for several years.
A point here I forgot to ask earlier. Doping. That would obviously take a player out of the cap calculation, yes? Do you remember a story about a certain Belgian team that wanted rid of a rider so told him to 'prepare' for a certain race and then 'advised' the UCI to test him? Would anyone today be unscrupulous enough to pull a stunt like that if the economics of the cap called for it?

Also, passport cases: would you get a credit for benching someone while you ran tests?
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Re:

11 Sep 2017 22:05

fmk_RoI wrote:As there's so much interest in a salary cap: anyone care to explain how it can be policed?

As I said early on, introducing such a system will just add "financial doping" to the mix. For the limited return on such a legislative investment I see little point in it.

Keep in mind there are way more people in the world skilled at financial shenanigans than there are at managing doping. Like orders of magnitude more.
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Re: Financial Fair Play

11 Sep 2017 22:58

Benotti69 wrote:
samhocking wrote:
Benotti69 wrote:
samhocking wrote:The OWCP riders change and are published each year/ Olympic cycle by UKSport & BC so I just copied and pasted that part from a members email, but there's no secret if you're a British pro tour rider on the OWCP program, you have free access to everything at British Cycling no matter what pro tour team you're on and it's free to that rider as a drop-in service between racing commercially. For riders not in the OWCP (has been cut from 16 to 8 pro riders) like Cavendish or Stannard they can still use British Cycling services under what UKSport now call the Elite Affiliate Programme I believe designed to manage their exit because clearly riders like Cavendish & Stannard have their entire coaching, medical and sports history at BC more or less and so this needs to be managed with their teams to take over instead of BC or to continue it.

In terms of the SLA between those OWCP riders in other teams, of course I don't have that agreement, but if you follow those riders, they're in and out of Manchester, especially if injured and recovering, but will be at the BC training camps, many still use BC Coaches within the season and in their build up for the Worlds each year and Olympics despite on different teams.

In terms of the SLA payments from TRLtd to BC, there was no financial conflicts raised in Deloitte report as far as I know. The main conflict, was non-Sky riders thought the OWCP riders were at an advantage if Sky riders and the non-Sky BC staff resented those working with Sky who they thought had more staffing resources being in both camps at once.


I asked for a link. When you are ready and in your own time.


A link to what exactly?

<snipped repitive response>


This

Benotti69 wrote:
samhocking wrote:British Cycling staff, even from day one invoice Tour Racing Ltd to an agreed Service Level Agreement Libertine based on what riders are OWCP or not. The Delloite investigation didn't find any conflicts, but did advise the SLA was extended to define the exact roles of dual staff supporting British pro tour riders who are Lottery-funded, British pro tour riders who are not Lottery-funded, and foreign pro tour riders on Team Sky so accounts could be paid according to the riders lottery funding or not. Since 2011 it's very clear-cut and you certainly couldn't have say Landa going to Manchester for free BC specialist treatment, Sky would be paying for that according to Tour Racing Ltd's SLA with BC, no different than any Pro tour team having an SLA with a private company or National body.
The following riders are lottery funded this year and would not have to pay to use any British Cycling resources even those that are not Sky riders.

Owain Doull (Sky)
Chris Froome (Sky)
Dan McLay (Bretagne–Séché Environnement)
Luke Rowe (Sky)
Ian Stannard (Sky)
Ben Swift (UAE)
Geraint Thomas (Sky)
Scott Thwaites (Dimension Data)

So, when Cavendish, not lottery funded needs to use British Cycling resources this year, either he pays for it personally now, or Dimension Data do. However, his team mate Scott Thwaites gets it free because he's on the OWCP even though not a Sky rider. The existing arrangement betwen British riders and British Cycling benefits other teams too, so it's not exactly a close relationship between Sky & British Cycling. All teams have free BC access and rider support if they employ a OWCP rider.

<snipped for brevity>


Got a link to this information?


TIA. :)


It's all easily found, but the OWCP list, reduced number of WCP athlete places offered by UK Sport, Athlete Performance Award (medical scheme), changes to the men’s road programme along with elite affiliate programme is here. One of the riders in my club is a BC coach and confirms how OWCP athletes use BC & UK Sport Funding, but I have no evidence to suggest otherwise if a pro tour rider is also on the OWCP he is denied this funding or use of BC facilities, so BCs email matches his experience as a coach. e.g. Thomas has received most of his treatment via British Cycling staff for example after Giro this year as OWCP rider.
Assuming you can search British Cycling website, I beleive the members emails are published there too under "world class performance programme" most likely although you can find the riders list and some other info here:
https://www.britishcycling.org.uk/about/article/20170424-about-bc-news-British-Cycling-confirms-revised-Great-Britain-Cycling-Team-squad-0

Tour Racing Ltd Accounts upto 2015 can be purchased from Companies House, I can't link to that dirctly, but it's at:
http://wck2.companieshouse.gov.uk

The Cycling Independent Review Panel Report is freely available to download as a .pdf where much of the working dual-staff comments come from. I can't find it online, but I have it if you can't find it and can upload. It Mainly covering Salaries paid to Team Sky members were, the Panel was informed, considerably higher than those paid to BC employees.

SLAs were regularly discussed in 2009 throughout all the media and mostly simply my memory following the progress of British Cycling as a member and out of interest as one of my friends contracts his coaching services to British cycling academy riders at the time so I knew a little of what the setup was from him working there and riders coming and going who were both Olypmpic & Sky riders at the same time and those that were not.

If you must have a link, the following article in Dec 2009 discusses SLAs between TRLtd & BC, namely:
"This is a contracted and salaried position. Brailsford is an employee of TRLtd and does not hold any financial stake in the company. There is a service level agreement between TRL and British Cycling so that coaching and support services provided to Team Sky riders who are not funded by the national lottery by BC’s staff are charged to the pro team." It's discussed in hundreds of articles from 2008-2009 however, this is just the first on google.

http://www.cyclingweekly.com/news/latest-news/team-sky-as-it-happens-70290#u8TDXpm2EqCBEt4V.99

Much of the rest is memory from Deloitte report snippets from various newspapers which considering 5 years old will all have been used to start the fire in my living room by now, but several of the articles are found on Guardians website who seem to cover cycling pretty well if you use their search for Deloitte, Phelps, UKSport and whatever keywords. The rest is simply 35 years reading about cycling teams in the media, books, podcasts and friends in the industry i'm afraid.
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Re: Re:

11 Sep 2017 23:27

Alex Simmons/RST wrote:
fmk_RoI wrote:As there's so much interest in a salary cap: anyone care to explain how it can be policed?

As I said early on, introducing such a system will just add "financial doping" to the mix. For the limited return on such a legislative investment I see little point in it.

Keep in mind there are way more people in the world skilled at financial shenanigans than there are at managing doping. Like orders of magnitude more.


I agree totally. For this reason if you want fairness for all teams, you control the whole of pro cycling and riders all come through a controlled environment like the Japan Keirin School i.e. set-up something like the JKA Foundation and have pseudo teams where everything is already structured and independent of sponsors ans finance per team. From the top down riders are ranked in terms of physical ability/tests and each team has a quota of equal ranked tested riders, perhaps even rotating leaders between all teams throughout the season to really find who is the strongest of the top ranked riders independent of unequal support that might exist. Not for me, but would be 100% fair for all teams that's for sure and would find the strongest rider each year.
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12 Sep 2017 03:54

I'm not sure a Keirin model is feasible as that is driven by gambling revenue (~$5 billion annually) and stadium attendance revenues (~5 million paying punters buying entry + food/drink etc so perhaps another $0.25 - 0.5B) rather than being reliant on sponsors or TV revenue. The nature of revenue streams and events (stadia only) means a closed administration and operational environment is feasible.

Road cycling pretty much only has sponsor revenue, a little bit of TV revenue (but in some cases has to pay to be on TV), and govt/taxpayer monies in form of hosting fees, and does not operate inside stadia. Risk management is off the scale. This makes a closed administrative environment all but impossible.

The ASO only makes perhaps $30-40M in annual profit, and that includes all their operations and events (e.g. Dakar Rally). They would be the most "profitable" organisation in cycling. RCS earns only a fraction of that.

Where's the money going to come from?
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Re: Financial Fair Play

12 Sep 2017 09:55

Of course it's not suitable, but if people want to remove all variables, like financial doping, feeder teams to catch the best upcomming riders before others, SLA's between the Pro Teams and their NGBs, equipment and sports science gains, use of wind tunnels, more staff, race hubs, bigger bonuses, softer beds, more expensive riders, you you have to remove all corporate control from the teams management and sponsorship directors and funnel the whole of cycling through some kind of sport that is a public sport like Kieren. In other words create a controlled pseudo sport and it's paid for by betting not corporate sponsorship. Capping wage budget, simply moves the goalposts, not the goal itslelf. The richer teams will simply find advantage outside the wage budget as you say.
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Re: Re:

12 Sep 2017 11:37

samhocking wrote:I agree totally. For this reason if you want fairness for all teams, you control the whole of pro cycling and riders all come through a controlled environment like the Japan Keirin School i.e. set-up something like the JKA Foundation and have pseudo teams where everything is already structured and independent of sponsors ans finance per team. From the top down riders are ranked in terms of physical ability/tests and each team has a quota of equal ranked tested riders, perhaps even rotating leaders between all teams throughout the season to really find who is the strongest of the top ranked riders independent of unequal support that might exist. Not for me, but would be 100% fair for all teams that's for sure and would find the strongest rider each year.
Or, as Chris Froome called it: communism.
"we're almost becoming communists, aren't we? Everybody's going to be the same. We should all ride the same bikes, have the same equipment sponsors, all eat the same rice and porridge every morning so no-one's got added fuel for the stage. "
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Re:

12 Sep 2017 12:06

Alex Simmons/RST wrote:I'm not sure a Keirin model is feasible as that is driven by gambling revenue (~$5 billion annually) and stadium attendance revenues (~5 million paying punters buying entry + food/drink etc so perhaps another $0.25 - 0.5B) rather than being reliant on sponsors or TV revenue. The nature of revenue streams and events (stadia only) means a closed administration and operational environment is feasible.
Realistically, it's a non-runner, I know, but ... imagine. A communist-style system, all the riders in central dorms. All on the same bikes, all eating the same food, all sharing the same coaches and swannies and wrench monkeys. We tell the CCTV rights to Endemol and so we're not just coining it in on TV revenue from the races, we've got reality TV as well. We drive out the teams, have it all run by ASO and let the fans pick who rides for what 'franchise' each week, a great big game of fantasy cycling, happening in front of your eyes, week in, week out. And we go back to the way it used to be and make all races finish in a velodrome, just cause we can. Given cycling's size zero obsession and the amount of eating disorders in the sport, we call it ... the Hunger Games.

BTW, have you seen ASO's profits + revenue recently? Looked for the first time in a while last week and they hit €47m in '14 ($57m), and were €46m in '15 ($50m): they're doing something right, that's for sure. (It's still small, relative to other sports, and the family wealth is still only about €300m, but they're pushing forward, hard).
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Re: Financial Fair Play

12 Sep 2017 12:22

samhocking wrote:Tour Racing Ltd Accounts upto 2015 can be purchased from Companies House, I can't link to that dirctly, but it's at:
http://wck2.companieshouse.gov.uk
They're actually free, as are most UK company accounts. Summary versions of many foreign ones can be found free by consulting Google.
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Re: Financial Fair Play

12 Sep 2017 12:29

samhocking wrote:There are no financial conflicts between TRLtd & BC as reported pretty clearly by Deloitte and also Phelps and if you want evidence of an SLA, British Cycling invoiced TRLtd £600 for Cope's trip supporting those two reports remember.
To take this back to the point originally made by Libertine Seguros, which was:
Libertine Seguros wrote:You can also point out that there's more to the Sky budget than the declared, or at least there was, due to the blurred lines between the commercial Team Sky and the national entity British Cycling, with staffers of the latter fulfilling functions ostensibly for British Cycling but serving for Team Sky - even if we take out the infamous jiffy bag, what was Simon Cope doing providing weeks of motorpacing training for Bradley Wiggins in aid of?
Let's actually keep in the Jiffy bag, because right there I think you have the crux of the problem: transfer pricing. GBP 600 for what Cope did is peanuts and effectively British Cycling subsidised the cost of moving the Jiffy bag from Manchester to Switzerland. Scale that up and you see the level of subsidy available.
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12 Sep 2017 20:23

Who knew Sean Kelly was pro cap?
I think there should be a cap some way on the top teams because they’re going further ahead and the other teams getting wild cards, the gap there is growing too much.

A salary cap or a cap on the number of riders you can have on their classement (in the UCI rankings), you can’t have all the top riders.

With Team Sky, the moment a rider starts going well… it’s almost like the time with Merckx, when the rider goes well Merckx buys him so he wouldn’t be a challenge to him.

Sky is the same, look at Kwiatkowski, they buy those riders in. Mikel Landa, the moment he started doing well, they signed him up.
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Re: Re:

12 Sep 2017 20:41

fmk_RoI wrote:
Alex Simmons/RST wrote:I'm not sure a Keirin model is feasible as that is driven by gambling revenue (~$5 billion annually) and stadium attendance revenues (~5 million paying punters buying entry + food/drink etc so perhaps another $0.25 - 0.5B) rather than being reliant on sponsors or TV revenue. The nature of revenue streams and events (stadia only) means a closed administration and operational environment is feasible.
Realistically, it's a non-runner, I know, but ... imagine. A communist-style system, all the riders in central dorms. All on the same bikes, all eating the same food, all sharing the same coaches and swannies and wrench monkeys. We tell the CCTV rights to Endemol and so we're not just coining it in on TV revenue from the races, we've got reality TV as well. We drive out the teams, have it all run by ASO and let the fans pick who rides for what 'franchise' each week, a great big game of fantasy cycling, happening in front of your eyes, week in, week out. And we go back to the way it used to be and make all races finish in a velodrome, just cause we can. Given cycling's size zero obsession and the amount of eating disorders in the sport, we call it ... the Hunger Games.

Why don't we just have Rollerball instead?

fmk_RoI wrote:BTW, have you seen ASO's profits + revenue recently? Looked for the first time in a while last week and they hit €47m in '14 ($57m), and were €46m in '15 ($50m): they're doing something right, that's for sure. (It's still small, relative to other sports, and the family wealth is still only about €300m, but they're pushing forward, hard).

Good to know. Still pretty small numbers though, RCS (Giro) is a fraction of that, while the rest of the cycling world loses money and a large portion of the revenue ASO and others do get is taxpayer subsidised.

Meanwhile, WANDAlust is on the horizon...
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Re: Re:

12 Sep 2017 21:03

Alex Simmons/RST wrote:Meanwhile, WANDAlust is on the horizon...
VN becoming the People's Daily I am particularly looking forward to...

(And chapeau on WANDAlust - that's a keeper.)
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Re: Re:

12 Sep 2017 22:15

fmk_RoI wrote:
The Hegelian wrote:My opinion flatly contradicts my favoured political-economy (which is very egalitarian). In that, I see pro-cycling as expressive of a genuine unfettered capitalism; it is for that reason, dysfunctional, anarchic, unfair/unjust and hugely governed by the worst kinds of self-interest. As a spectator watching a sport - this is actually a rather interesting concoction, and that includes the clinic issues which are part of the unfairness/injustice.
Actually, cycling isn't quite unfettered capitalism and has quite a but of socialism in it already. We have minimum salaries, which protect both the (financially) weak riders at WT level and try and keep the gap between WT and Pro-Conti manageable. We have limited revenue sharing, in the form of prize money and appearance money minimums. At the moment, we are concerned with protecting the weak from the excesses of capitalism. The salary cap, the franchises for life, the transfer market, that's all about protecting the strong from the excesses of capitalism.


I grant you this - there is no such thing as pure unfettered capitalism outside of textbooks. But as a matter of degrees, procycling has always been highly capitalistic - the fact that the teams are not places (like Manchester or Barcelona) but corporations sets the basic ontology. The whole structure is framed around maximising exposure - the template is: win = more advertising reach. So the riders are basically billboard-commodities, and the races themselves are tourism advertising. Whereas most other sports are (structurally and historically) sports first, which are then packaged and commodified into something which has value for advertisers.

I think that the present socialistic intervention into cycling is more about trying to stablise an inherently unstable system, rather than any humanitarian concern for weaker riders etc.

The point I make is probably a bit uncouth - it is simply that from the standpoint of a spectator, watching procycling has a touch of the Romans going off to the colloseum about it. There's nothing much just or noble about it, but it is admittedly fascinating.....in part because of its capitalistic-anarchic elements.

If I was an insider, I would strongly argue for the concerns you voice. The cyclists themselves definitely need to form a stronger union. But as a fan, I'd rather these egalitarian concerns be directed to the broader political economy itself - for cycling is a mere mirror to this. In short: fix it at its roots, not its leaves.
Last edited by The Hegelian on 13 Sep 2017 01:03, edited 1 time in total.
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Re: Re:

12 Sep 2017 23:12

The Hegelian wrote:
If I was an insider, I would strongly argue for the concerns you voice. The cyclists themselves definitely need to form a stronger union. But as a fan, I'd rather these egalitarian concerns be directed to the broader political economy itself - for cycling is a mere mirror to this. In short: fix it at its roots, not its leaves.


Absolutely. Pro cycling is leaving so much money on the table it's a joke. All the biggest companies I've seen advertising on Cycling have been targeted Google Ads playing before I open bootleg streams.
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